Coinbase Warns Brazil Against IOF Tax on Stablecoins Ahead of Elections

Crypto exchange Coinbase is urging Brazil's next government to reject proposed tax on stablecoins, known as IOF. The decision comes ahead of Brazil's October elections, where the new administration may face a policy choice over whether stablecoins remain virtual assets under existing crypto laws or are reclassified as electronic money or foreign currency.

Approximately 29 million Brazilians hold or have held cryptocurrency assets, which represents roughly one-sixth of the country's adult population and nearly three times the number of stock-market investors. This significant presence has led Coinbase to advocate for stablecoins to be treated as virtual assets within Brazil's current crypto framework.

The proposed reclassification could subject crypto transactions to IOF taxation, a move that Coinbase argues would have negative consequences for Brazilian users and the broader cryptocurrency market in the country.